HONEYWELL TO ACQUIRE JOHNSON MATTHEY'S CATALYST TECHNOLOGIES BUSINESS, EXPANDING PORTFOLIO OF LEADING CATALYST AND PROCESS TECHNOLOGIES

Rhea-AI Summary

Honeywell (NASDAQ: HON) has announced the acquisition of Johnson Matthey's Catalyst Technologies business for £1.8 billion in an all-cash deal, valued at approximately 11x estimated 2025 EBITDA. The acquisition will integrate with Honeywell's Energy and Sustainability Solutions (ESS) business segment, expanding its UOP business portfolio and installed base across refining and petrochemical catalysts. The deal will enable Honeywell to offer comprehensive solutions for lower emission fuels, including sustainable methanol, aviation fuel, blue hydrogen, and ammonia. Johnson Matthey's Catalyst Technologies has 1,900 employees and operates in the U.S., Europe, and India. The acquisition is expected to be accretive to earnings in the first year and close by 1H 2026. This move is part of Honeywell's broader strategic initiatives, which include $11 billion in recent acquisitions and planned spin-offs of its Aerospace Technologies and Advanced Materials businesses.

Positive

• £1.8 billion acquisition expected to be accretive to Honeywell's adjusted EPS in first full year
• Expands installed base and capabilities across refining, petrochemical and renewable fuels
• Enables comprehensive solutions offering for lower emission fuels production
• Significant cost synergies expected from integration with UOP and Honeywell Process Solutions
• Strengthens Honeywell's position in critical energy technology provision

Negative

• High acquisition cost at 11x estimated 2025 EBITDA
• Long closing timeline extending to 1H 2026
• Subject to regulatory approvals which could delay or affect the deal
• Integration challenges with 1,900 employees across multiple countries

Insights

Mergers & Acquisitions Specialist

Honeywell's £1.8B acquisition of Johnson Matthey's Catalyst Technologies strengthens its energy portfolio with complementary technologies and expanded market reach.

Honeywell's £1.8 billion acquisition of Johnson Matthey's Catalyst Technologies represents a strategic expansion of its Energy and Sustainability Solutions (ESS) segment. The deal values the target at approximately 11x estimated 2025 EBITDA, which appears reasonable when factoring in the anticipated tax benefits and cost synergies. This valuation indicates Honeywell is paying a premium but expects significant operational improvements to justify the investment.

This acquisition is particularly notable as it aligns with Honeywell's ongoing portfolio transformation. The company is simultaneously spinning off its Aerospace Technologies and Advanced Materials businesses while making targeted acquisitions (approximately $11 billion announced since December 2023) to reshape its business focus.

The strategic rationale is compelling. By integrating Johnson Matthey's catalyst manufacturing capabilities with Honeywell UOP's process technology licensing, Honeywell creates a more comprehensive offering spanning the entire value chain. This vertical integration should strengthen customer relationships by providing end-to-end solutions rather than components, potentially improving customer retention and increasing revenue per customer.

Most significantly, this acquisition expands Honeywell's capabilities in emerging growth markets for lower-emission fuels, including sustainable methanol, sustainable aviation fuel, blue hydrogen, and blue ammonia. These sectors represent high-growth opportunities as global energy companies invest heavily in decarbonization. The addition of Johnson Matthey's 1,900 employees and international facilities also provides Honeywell with expanded R&D capabilities and global reach to capitalize on these trends.

The expected accretive impact to earnings in the first year suggests confidence in rapid integration and minimal disruption. However, the projected closing timeline (1H 2026) indicates potential regulatory scrutiny, which bears monitoring as a risk factor to deal completion.

Energy Industry Strategist

Honeywell strategically positions for energy transition with acquisition that enhances renewable fuels capabilities and customer solutions.

This acquisition represents a significant strategic repositioning for Honeywell in the evolving energy landscape. By acquiring Johnson Matthey's Catalyst Technologies, Honeywell substantially strengthens its capabilities in both traditional hydrocarbon processing and emerging low-carbon technologies—a dual approach that hedges against energy transition uncertainties.

The timing is particularly strategic as the energy sector faces unprecedented pressure to reduce emissions while maintaining energy security. This acquisition provides Honeywell with enhanced capabilities in critical growth areas including sustainable aviation fuel (SAF), blue hydrogen, and sustainable methanol—all crucial technologies for decarbonization pathways that don't require immediate abandonment of existing infrastructure.

Particularly notable is how this expands Honeywell's renewable fuels capabilities. SAF represents one of the fastest-growing segments in the energy transition space, with projected 30%+ annual growth rates as airlines face mounting regulatory and market pressure to reduce emissions. Similarly, blue hydrogen (produced from natural gas with carbon capture) offers a pragmatic transition step toward hydrogen economies.

The integration of Johnson Matthey's catalyst expertise with Honeywell's UOP process technologies creates significant competitive advantages. Customers increasingly seek integrated solutions rather than piecing together technologies from multiple vendors. This comprehensive offering—spanning licensed technology, engineering, services, and catalysts—positions Honeywell as a one-stop provider across the hydrocarbon value chain.

Moreover, this acquisition follows the industry-wide trend of technology providers expanding their recurring revenue streams. By increasing its installed base, Honeywell enhances its aftermarket service opportunities, creating a more stable revenue profile less susceptible to capital expenditure cycles in the energy sector.

The £1.8 billion investment demonstrates Honeywell's conviction in chemical catalysis as a critical enabler of both traditional energy optimization and decarbonization pathways—positioning the company at the intersection of current energy demands and future transition requirements.

• Unlocks strategic growth by increasing Honeywell's installed base and creating a more integrated offering across catalyst and process technologies
• Expands Honeywell UOP's capabilities with addition of significant installed base across refining, petrochemical and renewable fuels
• Enhances Honeywell's existing catalyst portfolio with complementary offerings and grows renewable fuels capabilities
• Anticipated synergies with both UOP and Honeywell Process Solutions businesses, benefiting from Honeywell's leading aftermarket capabilities
• Expected to be accretive to Honeywell's adjusted EPS in the first full year of ownership and to add attractive high growth vectors with runway for material cost synergies 

CHARLOTTE, N.C., May 22, 2025 /PRNewswire/ -- Honeywell (NASDAQ: HON) today announced that it has agreed to acquire Johnson Matthey's Catalyst Technologies business segment for £1.8 billion in an all-cash transaction, representing approximately 11x estimated 2025 EBITDA, inclusive of tax benefits and run-rate cost synergies. The combination of Johnson Matthey's Catalyst Technologies business with Honeywell's Energy and Sustainability Solutions (ESS) business segment is expected to add attractive high growth vectors to the portfolio and drive significant additional benefits through cost synergies.

Johnson Matthey's Catalyst Technologies' business model complements Honeywell's existing UOP business of selling catalyst and process technologies and expands its installed base across refining and petrochemical catalysts. In addition, with an expanded portfolio, Honeywell will for the first time be able to offer customers a comprehensive solution for the production of lower emission, critical fuels including sustainable methanol, sustainable aviation fuel (SAF), blue hydrogen and blue ammonia, which enhance energy security and reduce emissions. The resulting offerings will provide licensed technology, engineering, services and catalysts to convert hydrocarbon and renewable feedstocks to high-value end products.

"The acquisition of Johnson Matthey's Catalyst Technologies business broadens Honeywell's role as a world-class technology provider of critical energy needed to drive growth into the future – further strengthening our model of combining process technologies and process automation," said Vimal Kapur, Chairman and CEO of Honeywell. "As demand for diversified sources of energy continues accelerating, we will better enable Honeywell to offer the innovation our customers need."

Johnson Matthey's Catalyst Technologies business segment is a leading provider of catalyst manufacturing and process technology licensing. It has approximately 1,900 employees and is headquartered in London, United Kingdom, with sites in the U.S., Europe and India.

"As we continue to expand and evolve our ESS portfolio, acquiring Johnson Matthey's Catalyst Technologies business will provide our customers a comprehensive and cost-effective approach to transition their businesses to high-value products with lower emissions," said Ken West, President and CEO of Honeywell's ESS segment. "Together, we will be able to create an integrated solution while also diversifying our UOP projects and service offerings to help our customers around the world continue innovating and driving energy security for the future."

The acquisition is expected to be accretive to earnings in the first year and will add attractive high growth vectors to Honeywell's ESS business.

The acquisition follows Honeywell's announcement of the planned spin off of its Aerospace Technologies business along with the planned spin off of its Advanced Materials business, which will result in three publicly listed industry leaders with distinct strategies and growth drivers.

Since December 2023, Honeywell has announced a number of strategic actions to drive organic growth and simplify its portfolio, including approximately $11 billion of accretive acquisitions recently closed or announced: the Access Solutions business from Carrier Global, Civitanavi Systems, CAES Systems, the LNG business from Air Products, and Sundyne. In addition, Honeywell entered into an agreement to divest its Personal Protective Equipment business, which is expected to close in Q2 2025. Honeywell remains on pace to exceed its commitment to deploy at least $25 billion toward high-return capital expenditures, dividends, opportunistic share purchases and accretive acquisitions through 2025.

Honeywell's acquisition of Johnson Matthey's Catalyst Technologies business segment is expected to close by 1H 2026, subject to customary closing conditions, including receipt of certain regulatory approvals.

About Honeywell
Honeywell is an integrated operating company serving a broad range of industries and geographies around the world. Our business is aligned with three powerful megatrends – automation, the future of aviation and energy transition – underpinned by our Honeywell Accelerator operating system and Honeywell Forge IoT platform. As a trusted partner, we help organizations solve the world's toughest, most complex challenges, providing actionable solutions and innovations through our Aerospace Technologies, Industrial Automation, Building Automation and Energy and Sustainability Solutions business segments that help make the world smarter and safer as well as more secure and sustainable. For more news and information on Honeywell, please visit www.honeywell.com/newsroom.

We describe many of the trends and other factors that drive our business and future results in this release. Such discussions contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act). Forward-looking statements are those that address activities, events, or developments that management intends, expects, projects, believes, or anticipates will or may occur in the future and include statements related to the proposed spin-off of the Company's Advanced Materials business into a stand-alone, publicly traded company and the proposed separation of Automation and Aerospace. They are based on management's assumptions and assessments in light of past experience and trends, current economic and industry conditions, expected future developments, and other relevant factors, many of which are difficult to predict and outside of our control. They are not guarantees of future performance, and actual results, developments and business decisions may differ significantly from those envisaged by our forward-looking statements. We do not undertake to update or revise any of our forward-looking statements, except as required by applicable securities law. Our forward-looking statements are also subject to material risks and uncertainties, including ongoing macroeconomic and geopolitical risks, such as lower GDP growth or recession, supply chain disruptions, capital markets volatility, inflation, and certain regional conflicts, that can affect our performance in both the near- and long-term. In addition, no assurance can be given that any plan, initiative, projection, goal, commitment, expectation, or prospect set forth in this release can or will be achieved. These forward-looking statements should be considered in light of the information included in this release, our Form 10-K and other filings with the Securities and Exchange Commission. Any forward-looking plans described herein are not final and may be modified or abandoned at any time.

This release references certain non-GAAP measures, including:

• Segment margin, which is defined as segment profit divided by net sales; segment profit, on an overall Honeywell basis, is defined as operating income, excluding stock compensation expense, pension and other postretirement service costs, amortization of acquisition-related intangibles, certain acquisition-related costs, and repositioning and other charges.
• Adjusted earnings per share, which is defined as diluted earning per share adjusted to exclude pension mark-to-market expense, amortization of acquisition-related intangibles, certain acquisition-related costs, and other items as described in reconciliations provided when we disclose adjusted earnings per share; and
• EBITDA, which we define as earnings before tax, depreciation and amortization.

Management believes that, when considered together with reported amounts, these measures are useful to investors and management in understanding our ongoing operations and in the analysis of ongoing operating trends.

Management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitations of these non-GAAP financial measures are that they exclude significant expenses and income that are required by GAAP to be recognized in the consolidated financials statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining these non-GAAP financial measures.

Contacts:
Media	Investor Relations
Stacey Jones	Sean Meakim
(980) 378-6258	704) 627-6200
Stacey.Jones@honeywell.com	Sean.Meakim@honeywell.com

 

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SOURCE Honeywell

FAQ

What is the value of Honeywell's (HON) acquisition of Johnson Matthey's Catalyst Technologies?

Honeywell is acquiring Johnson Matthey's Catalyst Technologies for £1.8 billion in an all-cash transaction, valued at approximately 11x estimated 2025 EBITDA.

When will Honeywell's acquisition of Johnson Matthey's Catalyst Technologies close?

The acquisition is expected to close by the first half of 2026, subject to customary closing conditions and regulatory approvals.

How will the Johnson Matthey acquisition benefit Honeywell's business?

The acquisition will expand Honeywell's UOP business portfolio, increase its installed base in refining and petrochemical catalysts, and enable comprehensive solutions for lower emission fuels production.

What is the expected financial impact of the Johnson Matthey acquisition on Honeywell (HON)?

The acquisition is expected to be accretive to Honeywell's adjusted EPS in the first full year of ownership and add high growth vectors with material cost synergies.

How many employees will Honeywell acquire from Johnson Matthey's Catalyst Technologies?

Johnson Matthey's Catalyst Technologies business has approximately 1,900 employees across sites in the U.S., Europe, and India.